Tax Treatment Relating To Provident Funds

EPF and Misc. provision act,1952 7 recognised by commissioner of PF and CIT

Not recognized by commissioner of income tax

Public provident fund ACT ,1968 account in SBI or post offices

Contributed by

Employer and employee

Employer and employee

Employer and employee

All assesses independently

Assessee’s contribution

Deduction u/s 80C

Deduction u/s 80C

Not income tax benefit

Deduction u/s 80c

Interest credited

Fully exempt

Exempt upto 9.5% p.a. any excess is taxable

Interest on employer contribution is taxable under other sources . interest on employer’s contribution is not taxable at the time of credit.

fully exempt

Withdrawal at the time of retirement

Exempted u/s 10(11)

Exempt u/s 10(12) subject to condition.

Employees contribution and interst theron is taxable .Employer contribution and interest theron is taxble as profit in lieu of salary ,under ‘salaries’

Exempted u/s 10(11)

Employer contribution

Not taxable

Amount exceeding 12% of the salary is taxable

Not taxable at the time of contribution

Note: Sum received by an employee under approved superannuation fund is also an exempt from tax u/s 10 (13) . salary for the purpose of provident fund is basic salary + DA (considered for retirement benefit ) + commission as a fixed percentage of turnover.

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